LS passes 2 bills extending CGST, IGST to J&K

As the Lok Sabha on Wednesday passed two crucial bills to extend Goods and Service Tax to Jammu & Kashmir, Union Finance Minister Arun Jaitley said that implementation of GST in J&K marks economic integration and would help increase the revenues of the state.

The two bills—the Central Goods and Services Tax (Extension to Jammu and Kashmir) Bill and the Integrated Goods and Services Tax (Extension to Jammu and Kashmir) Bill—are aimed at giving effect to the formal amendments required in Central GST (CGST) and Integrated GST (IGST) Acts by removing the exemption that was carved out for J&K.

During the discussion over the bill, Jaitley said that the GST is in the larger interest of traders and consumers of J&K and that the state government, its assembly and people should be "complimented" for the roll out.

"If they (J&K) didn't integrate, then the traders would not have got input credit and the tax on final products would have been higher... That would have made products costlier and consumers would have to pay more," the minister said, adding that J&K is a consumer state and GST being a destination-based tax, the revenues of the state would increase.

Jaitley further explained that if J&K do not come under the purview of GST, then the goods and commodities would become costlier and consumers would have to pay more. The new tax regime will benefit both consumers and traders, he said.

Participating in the discussion on the bills, Kalyan Banerjee of TMC said that the cost of most of the goods and services have increased post the GST and the GST Council has "arbitrary" powers to fix rates even without consulting Parliament.

Adhir Ranjan Chowdhury of Congress, who initiated the debate, criticised the government of taking ordinance route for implementing various laws. Taking a dig at the government, Chowdhury said that the UPA government was accused of policy paralysis, but the present government is undergoing "policy dialysis" and hence there was "economic stasis".

Supporting the bill, BJP's Jugal Kishore Sharma said, the new tax regime reflects the concept of economic integration. Jammu and Kashmir will be benefitted with the implementation of GST, he said. Members from other political parties including BJD, CPI(M), Shiv Sena also participated in the discussion.